You ain't kiddin'... as it turns out, too much corrosion on this motor.
I managed to get the head off over the broken bolt. Took a lot of hammering (using a wood block against the side of the head on the broken bolt side), but more corrosion issues were awaiting with the exhaust tube removal: 2 of the 4 bolts would not loosen and broke right off, which leaves me with a total of 4 broken bolts, stuck solid in the block (1 from the head, 1 from the base, and 2 from the exhaust shaft).
Another piece of bad news (I think): There is quite a bit of play at the top piston rod. Vertical, and lateral.
Shouldn't be any right? I can actually hear a "cluncky" sound when I turn the flywheel" back and forth.
So, I guess I'll have to write this one off and salvage and/or sale as many parts as I can, and call it a day.
Oh well.... can't always win!
By the way: kevinj was correct: The water grommet at the top of the tube was clogged solid.
Looks like this motor spent his life in salt water, without ever getting flushed after use.